Little Cabin in the Woods Requires Equitable Remedy

Unjust enrichment can occur when one party unfairly benefits from the investment of another party.  In such situations, the law looks to equitable principles to find a fair solution. In order to establish a claim of unjust enrichment, the plaintiff must prove that the defendant was enriched by the receipt of a benefit, that the benefit came at the plaintiff’s expense, and that it would be unjust to allow the defendant to retain the benefit under the circumstances.  In the current case, the trial court applied the doctrine of unjust enrichment to a dispute between two former friends about a cabin located on rented land. 

The plaintiffs purchased a cabin from one of the defendants, the father of their friend. At the time of the sale, the plaintiffs and the other defendant were friends. The cabin was sold, but the sale did not include the land on which the cabin was located. The plaintiff rented this land from the father for an annual fee. The land was managed by the friend. The plaintiffs made many structural improvements to the cabin over the years and the fair market value of the cabin increased.

At some point the plaintiffs and the defendants had a falling out. The defendants stopped sending invoices for the land rental, and the plaintiffs stopped paying rent.  The defendants eventually sent notice that the lease was terminated.
The plaintiffs sued. They advanced the theory of unjust enrichment and requested permission to sell the cabin without hindrance from the defendants or that the defendants purchase the cabin for its full value. The defendants requested that the court require the plaintiffs to remove the cabin from the premises.

After a trial, the district court identified the fair market value of the cabin and determined the amount of rent owed. The court determined requiring removal of the cabin was not economically feasible and entered judgment in favor of the plaintiffs for the value of the cabin minus the past rent due.

The defendants appealed the remedy crafted by the district court as an abuse of discretion. The appellate court reviewed the matter and determined the district court’s remedy was equitable and affirmed the award. So, the defendants received clear title to the cabin and the plaintiffs were compensated for the increased value of the cabin from the improvements made.  Eichinger v. Turkal, No. 2-232/11-1143, 2012 WL 1612090 (Iowa Ct. App. May 9, 2012).